“We expect total expenses, including cost of sales and operating expenses, to increase approximately 8% year-over-year.”

In context

“Brian Carolan (CFO): Thank you very much, Sanjay. I appreciate that. After more than 21 successful years with Commvault, I have decided this is the right time for me both professionally and personally to move on. Commvault is coming off another record year and is well positioned for success, and it gives me great pleasure to hand the CFO reins to Gary, who has been my colleague and partner for the past 16 years. I have great confidence in his ability to lead the team. Now, let's talk about the FY'22 results, which were the best year in our company's history. We reported record results driven by the Power of AND, with both software and SaaS contributing to our accelerating growth trajectory. We closed the year on a high note. Q4 was a record quarter. We exceeded $200 million in total revenue for the second consecutive quarter, with total revenue growth of 8% year-over-year to approximately $206 million. Software and products revenue increased 12% year-over-year to approximately $101 million. Q4 marked the first time in company history that we crossed the $100 million milestone in quarterly software revenue. Software-only growth, excluding appliance pass-through revenue, was approximately 15% year-over-year. Fourth quarter subscription software revenue increased 45% year-over-year to approximately $77 million. Subscription license sales represented 77% of total software revenue, an increase from 71% last quarter and 59% a year ago. We are clearly benefiting from the tailwinds of our subscription transition and our growing recurring revenue model. Revenue from software transactions over $100,000 increased 19% year-over-year and represented 73% of software revenue. The volume of these transactions grew 14% year-over-year, and the average deal size increased 4% to approximately $327,000. We closed numerous seven-figure deals in the quarter. Subscription and Metallic ARR grew 46% year-over-year to $346 million, now representing 59% of total ARR, up from 55% last quarter and 46% in Q4 '21. As Sanjay noted earlier, Metallic ARR crossed the $50 million milestone during the quarter. Total ARR increased 13% year-over-year to approximately $583 million. On a constant currency basis, ARR growth was up 14% year-over-year. This growth has been driven by new subscription customers and Metallic. This is an important proof point in the transformation of our company. We believe ARR is a good measure of the underlying health of the business and a barometer of our potential for future growth. Total recurring revenue, which includes subscription software, maintenance support services, and SaaS, grew 19% year-over-year to $173 million. Recurring revenue represented 84% of total revenue in the quarter, an increase from 76% a year ago. Now, I will discuss expenses and profitability. We reported fiscal fourth quarter gross margins of 85%. Consolidated gross margin reflects an increased mix of SaaS revenue, which expectedly carries a higher cost of sales than software. Total expenses, including both cost of sales and operating expenses, increased approximately 4% year-over-year to $157 million. Expense growth reflected a seasonal FICA tax reset, annual merit increases, and go-to-market investments. Q4 expenses also benefited from a $5.5 million net settlement of certain legal matters. This gain is netted with related expenses in G&A. Non-GAAP EBIT increased 20% year-over-year to a record of approximately $47 million, and non-GAAP EBIT margins improved by 230 basis points year-over-year to 22.6%. I will now discuss cash flows and the balance sheet. For the quarter, we generated approximately $87 million of free cash flow. The growth in free cash flow was driven by strong Q3 performance, growth in deferred revenue related to Metallic, and timing of payrolls. We ended the quarter with no debt and approximately $268 million in cash on the balance sheet, of which over 70% sits overseas. In Q4, we repurchased approximately 600,000 shares of our common stock for $40 million. Now, I will discuss our financial outlook for Q1 FY'23. We expect Q1 software revenue of approximately $89 million and total revenue of approximately $195 million. Due to ongoing geopolitical uncertainty, we are closely monitoring potential risks to our business, particularly customer spending patterns in Europe. Also note, Russian operations previously contributed approximately 1% of total revenue, which is factored into near-term guidance. We expect total expenses, including cost of sales and operating expenses, to increase approximately 8% year-over-year. This expense growth reflects SaaS infrastructure costs and go-to-market investments to support our accelerating revenue profile. We anticipate that this will result in non-GAAP EBIT margins of approximately 20%. Our projected share count for Q1 is approximately 46 million shares. As we begin the new fiscal year, I'll take a moment to update you on our progress towards the targets we laid out during our January 2021 Investor event. At that time, we outlined our plan to transition to a recurring revenue model characterized by sustainable growth, improved profitability, strong free cash flow, and an attractive capital return policy. I'm happy to report that we've made terrific progress. Our software and total revenue is currently tracking at or above target, while ARR is currently tracking materially above target. Subscription software mix and recurring revenue mix are comfortably within their targeted ranges. We ended FY'22 at 29 against the Rule of 40. We are very proud of the progress we've made considering we were at just nine two years ago. This improvement was driven by accelerating revenue growth and significant margin expansion, all while scaling a hyper-growth SaaS platform. While SaaS was not a major focal point of the Investor event, I'm pleased to report that Metallic is pacing well ahead of expectations. Factoring in the success and momentum of Metallic, we now believe that FY'23 non-GAAP EBIT margins should be in the low 20% range, currently reflected in consensus estimates. We remain focused on making continued progress towards our Investor Day target of 32 against the Rule of 40 in fiscal '23. From a capital return perspective, since the time of the event through March 31, 2022, we repurchased approximately 5.2 million shares for $367 million. The Board recently approved a new share repurchase authorization for up to $250 million of stock. In FY'23, we expect to continue with our existing practice to return approximately 75% of free cash flow over time. I will now turn the call back to Sanjay for his closing remarks.”